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Exercise 9.2 · Q16

Q.The owner of a milk store finds that, he can sell 980980 litres of milk each week at Rs 1414/litre and 12201220 litres of milk each week at Rs 1616/litre. Assuming a linear relationship between selling price and demand, how many litres could he sell weekly at Rs 1717/litre?

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Using linear interpolation between the two given price-demand points, the weekly demand at Rs 17/litre is 1340 litres.

Why Linear Interpolation Works Here

The problem tells us to assume a linear relationship between selling price and demand. That means if we plot price on one axis and quantity demanded on the other, the points will lie on a straight line. Once we know two points on that line, we can find any other point — including the demand at a price of Rs 17.

This is a classic application of the two-point form of a straight line. The key insight: the rate at which demand changes with price is constant.


Step-by-Step Solution

1. Identify the given points

Let price be pp (in Rs/litre) and demand be dd (in litres/week).

We have:

  • At p1=14p_1 = 14, d1=980d_1 = 980
  • At p2=16p_2 = 16, d2=1220d_2 = 1220

2. Find the slope of the line

The slope mm tells us how much demand changes per rupee change in price:

m=d2−d1p2−p1=1220−98016−14=2402=120m = \frac{d_2 - d_1}{p_2 - p_1} = \frac{1220 - 980}{16 - 14} = \frac{240}{2} = 120

So demand increases by 120 litres for every Rs 1 increase in price.

Tip

The positive slope makes sense here: higher price means more milk supplied (or more willingness to sell), so quantity demanded increases. In a typical demand curve the slope would be negative, but here "demand" means the quantity the store can sell — effectively the supply side.

3. Write the equation of the line

Using point-slope form with (p1,d1)=(14,980)(p_1, d_1) = (14, 980):

d−980=120(p−14)d - 980 = 120(p - 14)

Simplify:

d=120(p−14)+980d = 120(p - 14) + 980

d=120p−1680+980d = 120p - 1680 + 980 …

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